Putin signs law to keep leased planes in Russia

MOSCOW, RUSSIA (AP/REUTERS/TASS), — Russian President Vladimir Putin signed a law on support measures for civil aviation, providing the opportunity of registering rights to foreign airplanes leased by Russian companies and issuing domestic airworthiness certificates to them.


The document was posted on the official web portal of legal information.

Amendments to the Russian Air Code and some other legislative acts make it possible for Russian airlines to keep the foreign aircraft fleet and give an opportunity to operate them on domestic lines.
Civil aircraft will be certified using certification centers and test laboratories, with requirements to them to be determined by the Transport Ministry. The law is aimed at preserving the foreign airplane fleet with Russian operators for purposes of the smooth operation of civil aviation as part of anti-sanctions measures, the explanatory note said.

Many of the planes used by Russian airlines are leased from foreign companies, including several in Ireland, a member of the European Union. Last month, the EU banned the sale or leasing of planes to Russia as part of sanctions to punish Russia for invading Ukraine. It gave leasing companies until March 28 to end current contracts in Russia. Last week, Russia’s air-transport agency advised airlines with foreign-registered planes not to take them out of the country because of the risk they could be repossessed.

Separately, sanctions prevent Western companies from providing spare parts and maintenance to Russian airlines, and analysts say it is unclear whether the planes are insured anymore.
Various estimates place the number of foreign-owned planes operated by Russian airlines at around 500 or more, and the vast majority of them were inside Russia when the war started Feb. 24. Aviation consulting firm Ishka estimates that the foreign-owned planes are worth $12 billion, nearly half of that by Irish-based lessors.

Re-registering jets in Russia would aim to keep them flying domestically by granting access to new safety approvals.

But adding Russia as a second host country could put Moscow at odds with international rules barring the registration of civil planes in more than one country at a time.

Unless Western lessors agree to Russian requests to release their jets from foreign registries - widely seen as unlikely while they struggle as it is to regain control of assets - the new policy also paves the way for a major contractual debate.

But experts said it puts the onus on the airline to apply for new registration to keep flying inside Russia - at the risk of poisoning relations with powerful lessors once the crisis is over - or else do nothing and see their fleets grounded.

Russia's state aviation authority recommended last week that airlines with foreign-leased aircraft suspend flights abroad, making it harder for lessors to make repossessions. Some 425 jets are most at risk

Not all of Russia's 35 airlines, about 15 of which represent 95% of the country's traffic, are relishing what experts have already warned could spiral into aviation's largest default.
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